Lawrence Block Co. v. Palston
| Decision Date | 17 February 1954 |
| Citation | 266 P.2d 856,123 Cal.App.2d 300 |
| Parties | LAWRENCE BLOCK CO., Inc. v. PALSTON. Civ. 19194. |
| Court | California Court of Appeals Court of Appeals |
Tobias G. Klinger, Los Angeles, for appellant.
Marvin Osburn, Los Angeles, for respondent.
Appeal by defendant from an adverse judgment in an action to recover a broker's commission.
In October, 1950, defendant was the owner of a parcel of realty improved with an apartment building in Los Angeles. The property was encumbered with a first deed of trust in the then approximate amount of $49,000. According to the terms of the note secured by the deed of trust, it could not be paid in full until April 1, 1952, without the consent of the beneficiary, Mrs. Mae E. Blenkiron. Defendant decided to sell the property and listed it exclusively with Harold E. Phelps and Associates, a firm of real estate brokers. The property was listed for sale at $150,000.
In January, 1951, during the time the exclusive listing with Phelps was in effect, a salesman from the Phelps office, Walter H. Nichols, brought a salesman from plaintiff's office, H. B. Sawtell, to see defendant. Sawtell was introduced as an associate of Nichols. Plaintiff had no independent listing of the property, but was working in cooperation with the Phelps office in an effort to find a buyer. Sawtell submitted a written offer of $137,500, made by Aaron Neidorf to defendant. She refused the offer and asked that a larger offer be obtained.
On January 27, 1951, Sawtell, in the company of Nichols, brought another written offer from Neidorf to defendant in the amount of $142,500. It was typed on a printed form prepared by plaintiff. When presented to defendant, the offer had been signed by Neidorf. The instrument was also signed by plaintiff, as agent of defendant, acknowledging receipt of $1,000. paid by Neidorf on account of the purchase price. The instrument provided, in part, that the unpaid purchase price ($141,500.) would be paid as follows:
The offer was discussed by Sawtell, Nichols, and defendant for approximately an hour before defendant signed the document. During that time, the language in the offer 'to be secured by Seller' was stricken out in ink, and the phrase 'and subject to Seller securing a' was inserted in ink immediately after the statement of cash to be paid on demand of escrow. Defendant initialed the changes made. Thus, as modified, the provision relative to the payment of the purchase price reads as follows:
'[$] 1,000.00 Check as shown above as deposit
7,958.36 First Trust Deed covering premises at 2207 Harcourt St. L.A. to
be assigned to seller named herein
33,541.64 Cash on demand of escrow. And Subject To Seller Securing A
60,000.00 First Deed of Trust payable $474.60 per month including 5% int
and assumed by Buyer
40,000.00 Second Deed of Trust in favor of the Seller payable $316.40 or
more per month including 5% interest
-------------
$142,500.00 "
The agreement also provided that the purchase price included 'furniture and furnishings now on the premises as evidenced by an inventory to be furnished by the Seller and approved by the Buyer.' Following the paragraph setting forth the terms of the purchase price and under the heading 'Subject To:' there were the typewritten statements: 'O.P.A. Rent statements to be approved by Buyer'; 'Subject to buyer's inspection and approval of all apartments.' Defendant affixed her signature to the offer, as seller, beneath a number of printed lines comprising a part of the form reading:
The parties did not proceed to escrow.
Defendant testified that 'right away,' the same day, she telephoned Mrs. Blenkiron's secretary and requested that Mrs. Blenkiron increase the deed of trust to $60,000. The secretary talked it over with Mrs. Blenkiron. They told defendant that at that time they couldn't raise the 'mortgage' to that amount. Defendant so informed the brokers. In a conversation at defendant's home the next day, January 28, 1951, Sawtell and Nichols informed her, and agreed, that the deal was off if she 'couldn't raise the $60,000.'--that there was 'no deal,' 'absolutely no deal.' This evidence is uncontradicted.
Several days later, defendant received through H. E. Phelps and Associates an offer for the property from another party. In the meantime, Sawtell talked to Neidorf, and on February 1, 1951, he presented another written offer by Neidorf to defendant which she did not accept because she had already accepted the later offer made through Phelps.
Plaintiff, thereafter, filed this action against Mrs. Palston based upon the agreement of January 27, 1951, claiming a commission of $7,125. (5% of $142,500.) Plaintiff claims that its commission was earned when it obtained the agreement dated January 27th. Defendant alleged in her answer that the sale to Aaron Neidorf was made contingent upon her obtaining a $60,000. first deed of trust, payable $474.60 per month, including 5% interest, which was to be assumed by the buyer.
The court did not permit defendant to testify to any part of the discussion preceding her signing of the offer and the making of the changes therein, ruling that any discussion prior to the making of this contract was merged in the written agreement.
The court found: defendant employed plaintiff as a real estate broker to obtain, and plaintiff did obtain, an agreement dated January 27, 1951; the agreement was executed by Neidorf as buyer and defendant as seller; the promise in the agreement made by defendant to pay plaintiff the commission was not subject to the condition that the sale of the property be completed; the promise to pay plaintiff the commission was not subject to the provision 'subject to Seller securing a $60,000 first trust deed'; the promise was made unconditionally; and defendant, in the agreement of January 27, 1951, confirmed that she had employed and authorized plaintiff as a real estate broker to perform the service of obtaining said agreement signed by the buyer; and plaintiff did obtain the agreement. Judgment was for plaintiff. Defendant appeals.
Defendant contends the findings are not supported by the evidence. She says: 1. The agreement of January 27, 1951, including the payment of any commission, was contingent upon and subject to the condition of obtaining a $60,000. trust deed--which through no fault of hers did not occur--and further, that the payment of any commission by her was dependent upon completion of the sale. 2. Even under plaintiff's theory that it is entitled to commission for services rendered in procuring the agreement of January 27, it is necessary that the agreement be valid and binding; and evidence of a valid, binding agreement is lacking. 3. The court misapplied the parol evidence rule and erroneously excluded material testimony.
To entitle a broker to a commission for a sale of real property it must be established that in pursuance of his contract and within the time specified therein, he found a purchaser ready, able, and willing to buy on the terms and conditions specified in the contract of employment, or, if the exact terms are not specified in his contract, upon terms satisfactory and acceptable to his employer. 9 Cal.Jur.2d 240, § 79.
Plaintiff agrees that it is entitled to recover only if it found a buyer ready, able, and willing to buy on terms acceptable to defendant. It argues, however, that Neidorf was ready, able, and willing to buy on the terms of his written offer and that defendant accepted such terms by signing the agreement of January 27, 1951; consequently, she cannot question the readiness, willingness, and ability of the procured purchase to perform according to the terms of his offer. In support of its proposition, plaintiff relies on such cases as Deeble v. Stearns, 82 Cal.App.2d 296, 186 P.2d 173; Code v. Low, 81 Cal.App. 633, 254 P. 676; Carrington v. Smithers, 26 Cal.App. 460, 147 P. 225; Jauman v. McCusick, 166 Cal. 517, 137 P. 254. Those cases hold that a broker employed to sell real property has earned his commission when he has produced a purchaser who has been accepted by his principal as his purchaser by entering into a contract with him, and that the failure of either party to perform the contract is not material to the right of the broker to receive compensation from his principal. The rule laid down in those cases is based entirely on the principle that the broker, having performed what he was employed to do, is entitled to be paid without regard to the ultimate fate of the contract between his principal and the purchaser produced by him. Those cases have no application to a situation where the claim of the broker is based on a provision of a contract of sale between his principal...
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